Hosting decisions should not be made lightly: they can have a major impact on businesses and their customers. There’s no one-size-fits-all solution; every option has its pros and cons.
In-House
In-house hosting is when a business chooses to keep its data center and server hardware in its own building. This means that they handle the power supply, the server and application administration, manage their network, and provide their own maintenance.
Who It’s For:
When a company’s competitive advantage involves having top-of-the-line technology, that company can usually provide better service choosing in-house infrastructure. Another reason to host in-house is when a significant portion of revenue is dependent on the infrastructure, because it allows better risk mitigation.
The Cons:
On-site hosting involves a significant capital investment, involves more human resources, and requires a long-term commitment. Small businesses may not see enough return to profit.
Colocation
This partial outsourcing option is where a business rents a server rack at another site that guarantees both power and security, but it does not provide server hardware or support.
Who It’s For:
Companies that want to reduce overhead costs but still need to provide custom architecture for their developers benefit the most from colocation. It reduces the amount of overhead but allows for more specific hardware and IT control.
The Cons:
Colocation usually requires a two- to five-year hardware commitment and, if the site isn’t close to the business, that can mean that a significant amount of travel is needed for maintenance.
Dedicated and Managed Hosting
These two types of outsourced hosting involve renting a high-performance server. With dedicated hosting, a company opts to “self-manage,” so they can take care of their own server applications and configurations. In managed hosting, the outsourcer provides the management.
Who It’s For:
Small businesses benefit the most from full outsourcing. There’s less commitment, smaller overhead, less human resources requirement, and quick deployment. It also offers them the option of more up-to-date equipment and better flexibility and scalability. The reduced cost provides a better return, which is crucial for many small businesses.
The Cons:
The more that is outsourced, the less control a company has over its IT. The more specific and detailed IT requirements, the less viable outsourcing becomes.
By looking at the IT needs, a company should be able to decide what level of outsourcing is right for it. Every company has different needs and a different IT budget.
